Singapore International Airlines: Strategy With A Smile
Singapore Airlines has built a storied reputation for excellence in customer service, attention to detail and a progressive stance in designing strategy. It has established a well-orchestrated system that nurtures significant sources of competitive advantage that are used to support a strategy of differentiation. At the time of the case some of that luster might be fading with the advent of copycat competitors and intensifying pressures to compete on the basis of cost. The increasing incidence of alliances in the aviation industry is also raising new questions for Singapore Airlines. The case focuses on the multi-pronged efforts at SIA to build competitive advantage. It closes with a set of issues revolving around an impending alliance with Virgin Atlantic Airways.
The case helps develop a framework for understanding the concept of differentiation based competitive advantage. Specifically, it illustrates how an organization implementing a strategy of differentiation needs to design its entire value chain with intent to be outstanding in every value activity that it performs. Thus, it identifies the critical resource commitments that a differentiation strategy would require. This discussion is closely intertwined with an examination of the country-specific sources of competitive advantage.
It illustrates the concept of fit and positioning. The case allows the instructor to develop a sequential discussion that sets the stage for examining first, second and third order fit (consistency, reciprocity, and optimizing) along the lines of Porter (1997).
It sensitizes students to important considerations in selecting alliance partners when the organization enjoys an enviable reputation in the marketplace.